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DUBUQUE, Iowa (AP) - As a working, single mother of two who was making less than $24,115 per year, Rachel Regan thought home ownership was out of reach.

That was until City of Dubuque leaders set her on the right path. She finds herself today in what essentially is a brand-new house.

“New roof and siding, new insulation and new walls, floors, heat and central air,” said Regan, 25, of her Harold Street home in Dubuque. “It was completely gutted inside and out, and everything is brand new.”

The city launched a campaign about a year and a half ago to promote home ownership and residential development in the Washington Neighborhood, North End and downtown. The city planned to invest $19 million total through 2021 to improve 739 housing units, mainly using state and federal funding.

The city has spent more than $2.3 million in the past two fiscal years to improve 89 housing units, and it has provided more than $500,000 in assistance to 43 homebuyers.

In Regan’s case, the two-story, three-bedroom brick home built in 1894 fell into disrepair after being turned into a rental. Termite damage was found on the entire first floor and the joists for the second floor. Deteriorated fascia boards and trusses also were found around the entire house. A basement wall had fallen away from the home, and a retaining wall and water cistern had collapsed, according to city housing officials.

The city bought the property for about $79,000 last year and spent $128,600 rehabbing the home and removing lead paint.

Regan took advantage of a city home-ownership workshop, where she learned about the property and the city’s efforts. She obtained a mortgage from Dubuque Bank & Trust and purchased the home for $148,000 in June.

She also qualifies for a $40,000 forgivable loan and a $25,000 no-interest loan from the city to put toward purchase costs, financed through federal and state funds the city received.

“My (two) kids are in a safe, quiet neighborhood and love being able to play outside and have a yard and a deck,” said Regan, who previously lived in rental housing. “If it weren’t for them redoing this whole house and informing me of this, I would have had a starter home that needed a lot of work. And now, I’m worry-free for years to come.”

More than $15 million will be used to provide assistance to low- and moderate-income homeowners and renters to remove lead-based paint and other health and safety hazards as well as make other home improvements.

“It’s like someone turned on a spigot,” said Craig Sharkey, 55, of the stormwater that rushed into the basement of his home after a recent storm. “Usually, my sump pump will handle that, but when we had the power outage with that, in my basement, I had a foot of water down there. That’s the worst I’ve seen it down here.”

Sharkey recently was approved to receive financial assistance through the city’s Bee Branch Healthy Homes program. A facet of the city’s $19 million housing campaign, it provides five-year forgivable loans to qualified homeowners to make repairs to properties that have been damaged by repeated flash flooding.

He said the assistance will help place new gutters and a new driveway that will help direct stormwater out to the street and into city storm sewers, as well as install floor drains in his basement.

“There’s no way I could do it (without help),” said Sharkey, who is on disability. “I feel like I won the lottery.”

Nash said it is too early to fully assess the success of the efforts, but increased home values in the Washington Neighborhood point to positive results.

The total assessed value of properties purchased and rehabbed by Community Housing Initiatives, which partnered with the city to convert poorly maintained homes, duplexes and apartments into townhomes and single-family homes, increased by $795,000, or about $47,000 per property, according to city records.

On average, CHI homes have sold for about $99,000 compared to an average cost of $75,000 to rehab the properties and $32,000 average purchase price, according to city data.

“We sold our last two or three houses for more than $100,000, which was unheard of two or three years ago,” said David Harris, CHI’s Dubuque coordinator and former city housing director. “Appraised values typically did not support the cost of purchasing and rehabbing a property, but that gap is closing.”

Harris predicts the housing market in the Washington Neighborhood will stabilize within four years, eliminating the need for continued public subsidies.

Over the past four years, CHI has spent $2.7 million, matched by $375,000 in city funds, to purchase, rehab and resell 28 properties. And it recently agreed to extend its partnership with the city to rehab and sell another 20 properties over the next four years, with the city contributing $500,000.

“We have three properties … all of which were (recently) purchased before they were completed,” Harris said. “I’ve got buyers lining up before we’re done.”